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Zloty Claws Back Losses Despite Today's Dovish CPI Readings

PLN

EUR/PLN has reversed its earlier gains and last deals at 4.4453, just shy of neutral levels. The zloty is resilient despite cooler than expected CPI readings this morning, followed by fairly optimistic rhetoric re: disinflation from several government members. Abroad, the greenback has weakened in response to latest US data, which may have lent some support to the wider EM FX space.

  • POLGBs remain firmer across the curve, last trade 4.0-6.1bp richer across the curve. The Finance Ministry said that it will offer up to PLN30bn of bonds at 3-4 POLGB auctions in Q3, with PLN4-8bn of bonds to be auctioned on July 21.
  • The NBP will announce their rate decision next Wednesday, after studying the updated macroeconomic projections, which could be the highlight of this meeting. None of the 25 economists polled by Bloomberg so far expects any changes in interest rates.

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